State lets mine work proceed but warns revocation possible

BILLINGS (AP) — Montana regulators have allowed a company to proceed with exploration work for a large silver and copper mine near the Idaho border with a warning that the project’s license could be revoked if concerns over the environmental track record of its president are found valid.

The 300-worker Rock Creek Mine is proposed near the Cabinet Mountains Wilderness, a series of remote glaciated peaks and valleys that take their name from the area’s box-like rock formations.

Montana Department of Environmental Quality Director Tom Livers on Tuesday issued a one-year extension for exploration work at the site. The approval letter also put Hecla Mining Co. on notice that regulators are investigating president Phillips Baker’s previous association with the Pegasus Gold Corp.

Pegasus went into bankruptcy in 1998 after operating three mines that environmentalists say polluted surrounding waterways when cyanide, arsenic and other contaminants leaked out of the mines. Baker is a former Pegasus executive.

Government agencies have reportedly spent more than $74 million on a cleanup at a former Pegasus mine in central Montana — the Zortman-Landusky Mine on the edge of the Fort Belknap Indian Reservation.

A state law referred to as the “bad actor” provision blocks people who do not clean up or pay for the cleanup of old mines from starting new ones.

A coalition of environmental groups in October asked the state to enforce the provision by blocking Hecla’s mining plans for Rock Creek and a second proposal, the Montanore mine near the small northwestern city of Libby.

The Montanore Mine also would be constructed beneath the Cabinet Mountains Wilderness — a 35-mile (56-kilometer) long mountain range that’s shielded from most development and is home to grizzly bears, wolves and other species.

The wilderness area is considered an inland rainforest because it gets up to 100 inches of rain annually. Its laced with hiking and cross country skiing trails that draw tourists.

Environmental Quality spokeswoman Kristi Ponnozzo said there’s no timeline for when the agency’s investigation into the matter will be completed but added that officials “are taking it very seriously.”

Hecla Vice President Luke Russell said Wednesday that the environmentalists’ allegation was based upon an incorrect reading of state law.

“Hecla or its subsidiary companies working in Montana were never involved with any of the Pegasus operation,” Russell said.

He did not directly address Baker’s role with Pegasus.

But Russell said Hecla was proving itself a responsible company with cleanup work that began this year on another former mining site in northwest Montana, the Troy Mine, which closed in 2015.

An attorney for groups seeking to halt the project said the exploration license should not have been granted amid questions about whether it was legal to do so.

“We hope and expect that when (the state) finishes its investigation it will enforce the law by denying the top leadership of Pegasus Gold the privilege of mining in our state,” said Katherine O’Brien, an attorney with EarthJustice.

Earlier this month, the U.S. Forest Service said it was withholding a permit for full development of the Rock Creek Mine, citing concerns over impacts to the Cabinet Mountains Wilderness and the potential for contamination of groundwater and nearby streams.